26 Aug 2022 13:54

Segezha looking simultaneously into buying several assets left after foreign investors' exit from Russian market - CFO

MOSCOW. Aug 26 (Interfax) - Segezha Group forestry holding, the timber-industry asset of AFK Sistema , is currently involved in several processes to sell assets whose foreign owners have decided to exit the Russian market, Rovshan Aliyev, the company's vice president for finance and investment, told reporters.

"Of course, we are looking primarily at those assets that are being sold by foreign companies that have decided to leave the market. These assets are on everyone's mind, and everyone knows what this is about roughly. There is a rather complicated process, because, in addition to the tenders conducted by the sellers, there is also a decision by the government commission that must approve nearly all transactions, which are all quite large in scale. In each of these processes, several participants want to buy good assets at attractive prices, so we are participating practically everywhere," Aliyev said.

Aliyev did not say whether Segezha could complete any transactions this year, noting that the government commission on foreign investment must approve settlements with European and U.S. companies from so-called unfriendly countries that are selling their respective assets.

"It is too soon to talk about prospects and results now, because a deal has not been made until it has been completed. However, there is definitely interest on our part; and the opportunities for a number of assets are rather unique, because the assets were previously unavailable, and there was not any talk about their being for sale. There are currently rather unique opportunities to acquire quite significant facilities at attractive prices," Aliyev added.

The vice president confirmed Segezha's participation in several tenders for purchasing timber assets from foreigners: "Yes, we are participating in several tenders at the same time."

Several foreign investors in the forest industry have recently announced their intentions to exit the Russian market, including U.S. Sylvamo Corporation; Austria's Mondi group that recently announced an agreement to sell its pulp and paper mill to Viktor Kharitonin's Pharmstandard ; the Finnish-Swedish concern Stora Enso; and Swedish-Finnish IKEA.

Segezha this summer has created the CBK Holding LLC joint venture with Rossium. According to Interfax's sources, the JV is intended to invest in timber processing assets. Segezha owns 25% in CBK Holding; Sergei Sudarikov owns 25%; and the remaining 50% belongs to Rossium, as controlled by Roman Avdeev and the Region group.